Plantronics Q3 numbers beats expectations

SANTA CRUZ -- Strong sales domestically, especially of a new line of mobile products, helped boost Plantronics' third fiscal quarter numbers, the company announced Tuesday.

Third quarter net revenues were up compared to a year ago, but net income dropped slightly. The company beat its earlier forecasts.

"We continue to have a very strong financial position," said Pamela Strayer, senior vice president and chief financial officer at Plantronics. Net revenues, operating income and earnings per share all exceeded the high end of the company's recent guidance.

"The macro economic outlook remains challenging," Strayer said, noting that despite ongoing economic uncertainty in Europe and Asia where unemployment rates are still climbing, she was pleased with the quarter.

There was year-over-year growth in each of the company's major product categories, both internationally and domestically and the company continued to make inroads in the emerging unified communication market as well as generate increasing sales in the company's traditional office and call center market. Consumer product group revenues also grew 16 percent during the holiday quarter, typically the company's strongest season for that sector.

While mobile sales are expected to drop in the fourth quarter, a new hands free driving law in China has already yielded an uptick in sales in that region.

Strayer and Ken Kannappan, Plantronics chief executive officer and president, made their comments on a webcast conference call Tuesday with investors and analysts.

Advertisement

Kannappan said economic reports seem to indicate some improvement globally but not necessarily a "robust" one. If so, the company should see some more business in its office and call center business.

He cited recent breakthroughs in technology partnerships relating to unified communications -- a market sector unifying the technology for mobile, desktop and web-based communications -- and several commendations for innovation at the annual Consumer Electronics Show in Las Vegas earlier in the month.

Just a few weeks ago, Plantronics announced the layoffs of 41 people as the company moved jobs to an existing plant in Mexico to cut costs.

About 550 people work in the Santa Cruz office. The company said Tuesday that it had also expanded its research and development budget to press on with growth in the UC market.

At a glance

Plantronics Inc.

WHAT: A publicly held telephone and computer headset manufacturer.HEADQUARTERS: 345 Encinal St., Santa Cruz.BACKGROUND: Founded in 1961, Plantronics introduced the first lightweight communications headset in 1962.LEADERSHIP: Ken Kannappan, president and chief executive officer.INFORMATION: 831-426-5858; www.plantronics.com.STOCK PRICE: Shares trading on the NYSE were up 18 cents Tuesday to close at $39.16. The 52-week range is $28.76-$40.82.FINANCIALS: Third fiscal quarter net revenues were $197.4 million compared to $183.2 million a year ago. Net income for the quarter was $28.2 million compared to $30.9 million a year ago. The company also declared a quarterly dividend of 10 cents per share, payable on March 11, to stockholders of record at the close of business on Feb. 20, 2013.